P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways- View

I am in the midst of detailed research on the co. and as soon as I am
done I will be coming out with detailed report on the same soon.

In case u want annual reports of the company I can mail u them....just
for a quick update, in Jan2011 Sony has signed a coll.R&D agreement
with PI as also the MD of PI is presently Co-Chairman, CII National
Council on Agriculture.... recently PI had a concall post Q3FY11
numbers and broad takeaways from that were :


(1) Co.'s agri-input business has grown by 36 % in first nine months
of FY11 which is the highest growth achieved amongst its listed peers.


(2) Its Nominee Gold herbicide which was launched last year is doing
extremely well and is expected to become a blockbuster brand in few
years in respective category.


(3) In-licensing molecules currently constitute 30-35 % of the agri
business which is expected to rise to 50 % in 2 years which will
enable the co. to improve margins further.


(4) In Fy12, Co. is going to launch two molecules in agri segment
(insecticides).


(5) In agri segment all its business is from retail and has no
institutional contribution which is a unique model in the listed peer
space.


(6) Agri segment is going to do very well in Q4FY11 as because of
rains the season has got shifted to Q4.


(7) At present Insecticides contribute 50 % to the agri business, 30 %
is contributed by herbicides while other agri-inputs contribute 20 %
to the agri segment revenue.


(8) In custom synthesis space (CSM), PI is following a unique no-
conflict business model which is somewhat similar to Divis.


(9) In the CSM space it is the only or one of the only two suppliers
to its clients.


(10) Its CSM business has the provision to pass on raw material
increase to the customer.


(11) In CSM, majority of its clients are from agrochemicals space at
present but the mix is shifting to other sectors like imaging,
electronics & pharma.


(12) 95 % of CSM business accrues from patented products and that too
in their early lifecycle which makes PI the only company with such
business model in India.


(13) Order book position at the end of Dec.2010 stands at 250 mn. US$
which is to be executed in 2-3.5 years.


(14) Its new plant for CSM business is expected to get operational by
December 2011. With the existing capacity and the new plant, PI will
be able to serve orders worth 700-750 cr. per year in CSM business at
100 % utilisation.


(15) CAPEX for the new plant is put at Rs. 125 cr. by FY12 & FY13 out
of which 16-18 cr. has already been spent and initial works have
started and the entire CAPEX requirement is to be met by internal
accruals as well as out of the proceeds of sale of polymer business
which will get concluded by 31st March 2011.


(16) In the first 9 months of FY11, 3 to 4 molecules in CSM business
are commercialised and stabilised which has put slight pressure on the
margins and the delivery offtake has started to pick-up in Q3FY11
wherein it has attained 100 % growth YoY. Q4 is expected to see
similar performance for CSM business but the full benefit of the
commercialised molecules is expected to be seen from FY12 onwards in
which PI's CSM business is expected to grow significantly.


(17) There is usually a lag period between 3-6 months for the
molecules to get commercialised and stabilised but once that happens
the yields improve substantially and delivery offtake picks up.


(18) R&D capability of PI is getting recognised with Sony signing with
it a collaborative R&D agreement for carrying out joint research on
organic chemicals. This parternership is expected to put PI in the big
league few years down the line.


(19) PI has sold off its polymer business to Rhodia and the funds
raised out of the sale is to be utilised for the new plant which is
being set-up for CSM business.


(20) Co. is operating at approx. EBITDA margins of 16.5 % in agri
segment and 20 % in CSM business. For Q3FY11, Agri business
contributed 85.80 cr. which is YoY growth of 15 % whereas CSM business
contributed 87 cr. which entails to a YoY growth of 99.5 %. For 9
months ending Dec.2010, Agri Business contributed 305.1 cr. which is
36 % growth YoY whereas CSM business contributed 150.6 cr. which is 6
% growth YoY. The sluggish growth in CSM business is due to shift in
delivery schedules in favour of second half and time taken for
commercialisation of 3 molecules.


(21) Co. plans to continue its focus on innovative products in both of
its operating business segments and wants to pitch itself as a pure
R&D focussed co. in the years to come.


(22) Co. believes that the business model which it is following is
unique in India and in such model initial scale-up might be slow but
once a critical scale is achieved, the scale-up will be exponential
with decent margins since it is the critical supplier for most of the
products it serves.


--------------------------------------


Brief Overview of last 5 Years Financials :


Mar '06
Mar '07
Mar '08
Mar '09
Mar '10


12 mths
12 mths
12 mths
12 mths
12 mths


Income


Sales Turnover
326.83
391.08
455.46
551.60
619.15


Excise Duty
20.38
34.03
38.56
35.72
24.78


Net Sales
306.45
357.05
416.90
515.88
594.37


Other Income
1.93
2.21
4.88
1.04
4.70


Stock Adjustments
6.70
1.47
0.28
16.58
-2.25


Total Income
315.08
360.73
422.06
533.50
596.82


Operating Profit
23.19
29.76
32.53
63.30
82.74


PBDIT
25.12
31.97
37.41
64.34
87.44


Interest
10.16
13.95
17.73
22.28
18.31


PBDT
14.96
18.02
19.68
42.06
69.13


Depreciation
7.31
8.66
9.73
11.13
12.76


Other Written Off
0.72
0.56
0.37
0.37
0.37


Profit Before Tax
6.93
8.80
9.58
30.56
56.00


Extra-ordinary items
0.32
0.16
0.11
0.28
0.20


PBT (Post Extra-ord Items)
7.25
8.96
9.69
30.84
56.20


Tax
3.28
4.51
3.40
7.74
15.27


Reported Net Profit
3.98
4.46
6.29
23.09
40.95


---------------------------------------


Shareholding :


Currently, Promoters hold 71 % stake in the company and Standard
Chartered PE holds 5 % equity (CCPS converted last year at Rs. 327---
post bonus adjusted price works out to Rs. 218) while Mr. Seshadri &
his associates (of Halcyon Resources) hold around 2 %. Rowanhill
Investments, a European investment firm holds 11 % equity in the
company which (as per sources) is selling its part stake in the market
to improve liquidity of the company on the bourses.


Standard Chartered PE still has unconverted CCPS worth 8.1 cr. and
unconverted OCDs worth 29.4 cr. which, as per sources, is going to get
converted into equity by next month at Rs. 500-525 per share. Evenif
we assume the price of conversion at lowest being 450 rs. which is the
low of past six months, then the equity of PI after the said
conversion will be somewhere at 13.5 cr. with 14.9 % stake held by
Standard Chartered PE and 62-65 % stake held by promoters with no
likely equity dilution till FY13.


------------------------


Debt :


Current debt is at approx. 165 cr. and as per the management concall,
management will be keeping D/E at 1 even with planned CAPEX and
acquisitions because of expected internal accruals as well as proceeds
from sale of polymer business to Rhodia (which sources say will be
close to 80 cr.)


-------------------------


Fellow members' views are invited on the company which will help me in
my research on the company. The analysis that I have done so far make
me believe that the story is interesting here with clean management
and backing by a respectable PE firm coupled with a closed company
structure and management's new-found willingness to share company's
prospects with financial fraternity. I believe that company will
command a premium valuations on the bourses because of its unique and
growth-oriented business model as well as its underownership and make
it a rare concept stock operating with decent margins.

Rgds.

Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

how do u think is Rallis India the peer company if we compare Rallis and PI Industires?

Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

Rallis is a well established company as far as agrochemicals sector goes. It has built strong brands in domestic market over last many years and has a equally good export presence. However, when we look at companies we need to look at what rate they are available at. Rallis is quoting at almost 3 times its sales. It is a safe bet on agrocemicals sector because of its growth prospects.

On the other hand, PI Industries, whose agri-input business is almost half the size of Rallis and if we compare the entire topline then PI is just 35 % short of Rallis yearly sales, but still, PI is quoting at just 1 times sales and at a FY11e p/e multiple of just 11. Rallis's strength lies in its well-established brands and the company is also dependent on institutional business as also prone to slowdown in export markets (like UPL), in contrast, PI's agri-input business is 100 % domestic with complete retail business and nil institutional business. Hence, the topline and bottomline of PI will be much more stable than Rallis. Also, the csm business of PI which is 100 % exports has a order-book position of 1100 cr. which is almost 5 times its FY11e csm business topline as also it has a provision to pass on the raw material cost increase and hence here also the business will be quite stable for atleast next 3-4 years. Then comes the strong R&D capability of PI which has enabled it to sign a collaborative research agreement with world-major Sony which, 4-5 years down the line, will make PI joint beneficiary of produce of such collaboration.

Also the things working in favour of PI is the unique business model it follows for both of its businesses. I will explain such models in slioght detail below :

P. I. Industries Ltd. is a company engaged in two high-potential business segments viz. Agri-Inputs & Custom Synthesis (CSM). It derives its strength from its strong association with leading global innovator companies to whom it offers a unique no-conflict business model with utmost respect to IPs. The success of this business model is evident from the fact that 95 % of PI's CSM business comes from patented molecules and that too in early part of their lifecycle. Such early-stage association with global innovator companies makes PI their partner rather than a supplier which derisks its business to a great extent. Another aspect which makes the business model of PI (in CSM space) a relatively safe and derisked one is the fact that to most of its customers in CSM space, PI either is the only or one of the only two suppliers. Hence, the only risk that remains with PI is the delivery risk which is taken care of by the professional and efficient management at top assisted by the inputs from Standard Chartered PE (which currently holds 5 % stake in PI that is likely to be raised to 12-15 % by April 2010) and Halcyon Resources (founded by ex-KPMG, ex-Anderson head Mr. Seshadri who himself holds 1.17 % stake in PI).

In agri-input business too, PI adopts a very unique business model which is quite distinct from its peers. It derives its agri-input business model from its other segment viz., CSM wherein first it draws global innovator companies' molecules to CSM space and then, if the management feels that such innovative molecule also has a market potential in India, then it enters into an inlicensing arrangement with the respective global innovator company which not only enhances the trust of the customer but gives PI a privileged status in customer's business strategy. The success of this agri-input business model is evident from the performance of PI's flagship brand Nominee Gold, a rice herbicide, which was brought to India by PI via inlicensing arrangement with Japan's Kumiai Chemical. Within just one and a half year of Nominee's launch, it has attained brand leadership status in the respective category and is expected to contribute almost 20 % to the current FY11 agri-input business revenues of PI. Agri-input business model of PI derives its strength from its strong distribution network which is spread across 1500 + disributors and a pan-india reach to 25000 + retailers.

Hence, with such a unique business model as well as its current CSM business order-book at 250 mn. US$, which is almost 5 times its current yearly revenue tick-rate of CSM business, PI Industries deserves a closer look and so offers a lot more upside than Rallis.

Rgds.

Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

Hi all,

Some queries and follow-up queries were raised on another forum on PI
Industries which makes me to believe that still many are not
understanding the business model of PI properly. Hence, attaching the
queries below as also follow-up queries in my next post alongwith my
reply to each of the query for all members reference.. Members are
welcome to raise further queries which will help us all collectively
understand the company as well as its potential better.


----------------------------------------
Query -
Hi Mahesh,


Thank you for the detailed report.


Does the CSM business have enough potential for scaling up if it is
only about research? After inventing a molecule in the CSM bus, does
the com also involve in manufacturing the product?


Regards
-----------------------------------------
My Reply -


To answer second part of your query first, Yes, PI is involved in
maufacturing and it is just that it is involved with the molecules in
very early part of its lifecycle. To most of its suppliers it is the
only or one of the only two suppliers since 95 % of the csm business
comes from patented molecules. Also, to clarify, PI is not directly
involved in inventing any molecule in csm business - that part is done
by global innovators with whom PI deals with; PI is rather involved in
product process research so as to manufacture the molecule with high
yield and scheduled delivery time.


Rgdg. the scalability aspect of csm business, at present PI has an
order-book of approx. 1100 cr. to be executed in 2-3.5 yrs... This
order book itself is 5 times of FY11e csm revenues of around 200-230
cr. Hence, till FY14 atleast a revenue of 300-350 cr. per year can
easily be achieved in csm business out of only the present order-book
assuming that there will be no fresh inflow of order. The important
point to note here is that almost 70 % of the current order book is
gained by PI in last 10 months which depicts a healthy trend and
promises increase in order-book in months to come. Also, 80 % of the
order-book is contributed by Agrochemical sector which leaves ample
scope to tap other segments like imaging, electronics and pharma which
are fast making their dent in the order-flow. Hence, as far as
scalability goes, i don't think its a concen as far as PI's csm
business goes. With the new plat becoming operational by Dec.2011, PI
will have a capacity to serve orders worth 700-750 cr. p.a. in FY13
and company has adopted a policy in csm business of not expanding w/o
tying up offtake..


I think one needs to understand first PI's business model to assess
its future potential and for that I am explaining the model in brief
for both of PI's operating segments below :


P. I. Industries Ltd. (BSE 523642) is a company engaged in two high-
potential business segments viz. Agri-Inputs & Custom Synthesis (CSM).
It derives its strength from its strong association with leading
global innovator companies to whom it offers a unique no-conflict
business model with utmost respect to IPs. The success of this
business model is evident from the fact that 95 % of PI's CSM business
comes from patented molecules and that too in early part of their
lifecycle. Such early-stage association with global innovator
companies makes PI their partner rather than a supplier which derisks
its business to a great extent. Another aspect which makes the
business model of PI (in CSM space) a relatively safe and derisked one
is the fact that to most of its customers in CSM space, PI either is
the only or one of the only two suppliers. Hence, the only risk that
remains with PI is the delivery risk which is taken care of by the
professional and efficient management at top assisted by the inputs
from Standard Chartered PE (which currently holds 5 % stake in PI that
is likely to be raised to 12-15 % by April 2010) and Halcyon Resources
(founded by ex-KPMG, ex-Anderson head Mr. Seshadri who himself holds
1.17 % stake in PI).


In agri-input business too, PI adopts a very unique business model
which is quite distinct from its peers. It derives its agri-input
business model from its other segment viz., CSM wherein first it draws
global innovator companies' molecules to CSM space and then, if the
management feels that such innovative molecule also has a market
potential in India, then it enters into an inlicensing arrangement
with the respective global innovator company which not only enhances
the trust of the customer but gives PI a privileged status in
customer's business strategy. The success of this agri-input business
model is evident from the performance of PI's flagship brand Nominee
Gold, a rice herbicide, which was brought to India by PI via
inlicensing arrangement with Japan's Kumiai Chemical. Within just one
and a half year of Nominee's launch, it has attained brand leadership
status in the respective category and is expected to contribute almost
20 % to the current FY11 agri-input business revenues of PI. Agri-
input business model of PI derives its strength from its strong
distribution network which is spread across 1500 + disributors and a
pan-india reach to 25000 + retailers.


Rgds.

Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

Follow Up Queries Raised -
Hi, Mahesh,

I got it. The goodwill of the global innovator cos is the greatest
asset in this model.


The growth in CSM revenues of PI was so sudden that it looks like
outsourcing possibilities suddenly dawned upon the global cos


How many global cos have a tieup, who are the major ones? How long is
the relationship with these cos (is it a new & untested relationship
built only in the last one year?)


Do not know about the manufacturing process much....is the "process
research" a unique competency (will each molecule have totally
different and complex process). Can other large chemical/pharma
manufacturers see the profit in CSM bus and scaleup faster than PI?
Who are the current competitors?


Is this potential already priced-in considering the 3 fold jump in the
stock price of PI?


Thank you again for explaining in detail.


Rgds
-------------------------------------------------------------------------
My Reply -


Firstly Thanks for your kind words.


Now, to get back to your points, I think you need to look at the
history of PI as also hear the entire concall to understand some
things which are complex. I will be more than happy to provide you the
entire playback of 74 minutes long concall which was held recently.
Its in mp3 form and if u want that do mail me I will immediately
provide it to you. Also, I have with me past 10 ARs of PI which give a
great insight into the road traversed by the company in last many
years in both agri-input and csm space. I will provide you that also
as research is a very tough process and we need to dig deeper and
deeper into a company to arrive at fair and true potential of the
company.


Now, to reply to your points, i will try to do it as briefly and
simplistically as possible so that things get crystal clear.


To your first point that "growth in CSM revenues of PI was so sudden
that it looks like outsourcing possibilities suddenly dawned upon the
global cos" ,


No- it is not sudden. Its the result of last 10 years efforts put-in
by the company and the relationship built in and credibility
established. Yes.. PI is into csm business since 2000 and I don't know
you are aware or not but the business model which PI has adopted of
focussing on patented products, it takes a great amount of time to
estblish trust and prove your R&D capability. Once these things are
done scale-up is very fast as in India there is no company following
such model of focus on patented products (most are focussing on off-
patent molecules) and that too in their early lifecycle. Such
molecules are very critical to the innovator companies and so they
pick their suppliers very carefully. This is the reason why in early
part there are just one or maximum two suppliers selected after
rigorous evaluation as any delay in delivery or flaw can result in
significant loss of revenues to innovator companies. Hence, it was the
efforts of PI since last many years that has resulted in swell in
order book and it was not atall sudden.


Now, to your second point as to "How many global cos have a tieup, who
are the major ones? How long is the relationship with these cos (is it
a new & untested relationship built only in the last one year?"


I will say here that many of such relationships are kept confidential
except the ones that we can know of when the company inlicenses their
molecules for Indian market (as in case of Nominee). Hence, co. has
not provided no. of companies with which it currently has tie-up and
their names. However, the relationship in this business are not atall
untested and short since these are critical relationships which
affects both parties equally- also, the current order book is the
result of last many years relationship which PI has built with global
agrichem companies and so the relationships oversighting the order-
book are of many years.


Now, to your third point as to "Do not know about the manufacturing
process much....is the "process research" a unique competency (will
each molecule have totally different and complex process). Can other
large chemical/pharma manufacturers see the profit in CSM bus and
scaleup faster than PI? Who are the current competitors?"


Yes- the process research especially in early lifecycle of a patented
molecule is a unique competency since in early stage the molecule
delivery channel is highly volatile and therefore takes a time of 6
months to stabilise... once stabilisation is done only after that
delivery can start. Other companies in India normally focus on off-
patent products. Also, a few who focus on patented products like Divis
has a slight different operating landscape and model than PI. To add
further, focus on patented molecules is a time-consuming process and
the scale-up here is much slower in the initail stage and so companies
in India will not attempt to do so. As far as competition goes, there
are no domestic competitors for PI and the current order-book is
established by PI by winning orders against Saltigo, Lonza and DSM -
all global majors in CSM space.


Now, rgdg. your last point "Is this potential already priced-in
considering the 3 fold jump in the stock price of PI?" ..


I will say a clear NO. Such innovative companies always quote at
premium and PI is a concept stock and so should quote at a significant
premium. If you consider FY11e numbers, then PI's agri-input business
should close in at 400 cr. and csm business at minimum 200 cr. Based
on FY11e estimates PI is currently quoting at a p/e of just 11 and a
mcap-to-sales of just 1. reasonable valuation of PI should be
somewhere at either 15 p/e or a mcap-to-sales of 1.5-2 considering its
underownership, clean management, backing by a strong PE and pending
order-book giving visibility of future revenues and profts. Once the
tie-up with Sony materialises in 3-4 years, PI should quote at a
valuation of Divis somewhere at 25+ p/e. To just highlight a point, to
inaugurate Sony-PI R&D facility Mr. Osamu Kumagai, Sony's vice-
president was himself present which gives PI a great recognition.


Lastly, again I will say I will be more than happy to provide you
playback of entire concall which is a must hear if you want to
understand the company better.


Rgds.

Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

As per the latest data available, HSBC AMC has bought 0.68 % equity of PI Industries via two of its funds - HSBC MidCap Fund (0.58 % or 66,000 shares) and HSBC Smallcap Fund (0.1 % or 11,000 shares).

Rgds.

Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

Monsoon, the key factor for agri-input players like PI Ind., is forecast to be normal this year... A consecutive normal monsoon year will significantly boost the financials of the company.

Normal monsoon likely this year
PTI

April 3, 2011: New Delhi, Apr 3 India is likely to experience a normal monsoon for the second consecutive year, raising hopes for a good crop for millions of farmers across the country.

There are no worrying signs as yet, said Mr D Sivananda Pai, chief forecaster and Director of the National Climate Centre.

The La Nina phenomenon, marked by intense cooling of the equatorial and east Pacific Ocean, is expected to continue till June, he said. Such condition is known to benefit the south-west monsoon.

Mr Pai said as per current indicators, scientists do not foresee any immediate warming of the equatorial Pacific- a phenomenon that could affect the south-west monsoon.

A normal monsoon is likely to bring cheers to over 235 million farmers as it will help in sowing of rice, sugarcane, soyabean and corn and lead to high agricultural output.

Last year, the country saw a normal monsoon with 413 of the 597 meteorological districts receiving normal or above normal rainfall. Nearly one-third of the 597 districts received deficient rains, while 11 got scanty falls last year.

South Asian Climate Outlook Forum, with representatives from weather offices of the regional countries, is meeting in Pune later this month to develop a consensus-based outlook for the ensuing summer monsoon.

The India Meteorological Department (IMD) is expected to come out with its long term forecast of the summer monsoon rainfall season by the end of this month.

Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

PI Industries Ltd has informed BSE that a meeting of the Board of Directors of the Company will be held on April 14, 2011, inter alia, to consider the following:

1. To consider and approve the Audited Financial Results of the Company for the year ended March 31, 2011 and

2. To recommend dividend, if any, for the year ended March 31, 2011.

Rgds.

Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

PI Industries posts excellent results.... Topline at 212 cr. for Q4 with OP at 35.6 cr. and NP at 20.4 cr.

Declares rs. 4 div. and split to rs. 5.

Results are ahead of expectations... will have to check rgdg. separate figures for agri and csm businessess... will come back on that..

For details refer link http://www.bseindia.com/xml-data/corpfiling/AttachHis/PI_Industries_Ltd_150411_Rst.pdf

Rgds.

Re: P.I. Industries (1100 cr. Order-Book + Unique Bus.Model)- Concall Key Takeaways-

Attached is the link to just published FY2011 Annual Report of P.I. Industries Ltd. for your perusal. Key Takeaways from the annual report are also attached for reference.


http://www.scribd.com/doc/58807068

Rgds.

-------------------------------
Key Takeaways from recent FY2011 Annual Report of P. I. Industries Ltd. :

(1) Revenue of the company increased by 33 % YoY to Rs. 719 cr. backed by a 38 % rise in Agri-Input business and a 23 % rise in Custom-Synthesis (CSM) business.

(2) Operating Profit increased by 41 % YoY to Rs. 123.64 cr. backed by a 105 basis points expansion in OPM. This expansion in margins was achieved inspite of the fact that company's Polymer business (which is now sold off to Rhodia, S.A.) witnessed significant pressure on margins because of input-cost pressures.

(3) Company foresees FY12 to attain similar growth rates with a good expansion in margins backed by new product launches in Agri-Input segment and ~Rs. 1350 cr. order-book of CSM business.

(4) In end-FY11, company has started commercial production of some very promising products revenues of which are going to accrue in FY12.

(5) Key highlight of FY11 was the signing of an agreement with the largest electronics company of the world, Sony Corporation to set-up a joint research centre in Udaipur, named PI-Sony Research Centre, which was inaugrated in January 2011. As per the agreement, this R&D centre will be engaged in developing commercially viable processes for molecules invented by Sony.

(6) In PI-Sony R&D centre, work has already commenced on innovative chemicals meant for use in futuristic products like flexible television and solar cells. This centre is projected to be a potential future growth driver for the company.

(7) Company's flagship brand in Agri-Input segment viz., Nominee Gold has attained a status of the fastest growing herbicide brand of India. In coming years, company expects Nominee Gold to attain a status of the largest herbicide brand in India with respect to Rice crop.

(8) In FY11, company has, in association with a leading MNC, successfully introduced a herbicide in soyabean and pulses segment.

(9) In FY11, company has filed registration for two new molecules and has signed four new agreements with original patent holders to evaluate the domestic launch of their innovative molecules in herbicide / fungicide segment.

(10) Company has signed a distribution agreement with a leading MNC for marketing of its new generation insecticide and acaricide which will help PI further strengthen its dominant position in plantation, field crops, vegetables and fruits.

(11) In FY11, company filed Seven patent applications for new non-patent-infringing processes developed for various molecules.

(12) Company's upcoming plant at Jambusar is presently under construction and is expected to get commissioned in last quarter of FY12. This plant, once operational, is expected to contribute heavily towards the growth of the company.